Bank co-finances construction of greenfield plant in Craiova
The European Bank for Reconstruction and Development (EBRD) is providing a €23 million loan for the expansion of Turkey’s leading confectionery producer ETİ Gıda Sanayi ve Ticaret A.S. into Romania.
The company is building a greenfield confectionery factory in Ghercești, a town on the outskirts of the Romanian city of Craiova in the south of the country. The total cost of the investment will be €40 million.
Founded in 1962, ETİ Gida is a family-owned company based in Eskişehir, Turkey. It produces biscuits, cakes, crackers and chocolate under 45 brand names and operates seven plants across the country. The company exports about a tenth of its total production. Romania, Bulgaria and the Western Balkans are among its most important export destinations.
With an 11,000-tonne production capacity in its first year of operation and spanning over 75,800 square metres, ETİ Gıda’s new factory in Romania will become the company’s production hub in the European Union and allow it to boost business outside its home base.
The investment represents ETİ Gıda’s first expansion beyond Turkey. Romania was chosen to serve as its future production base in the EU because of the country’s attractiveness to foreign investors, with its growing domestic market, good transport links and well-educated workforce.
Announcing EBRD finance to ETİ Gida, James Hyslop, EBRD Director for Romania, said: “Through this project the EBRD is not only helping a successful Turkish company to grow, it is also supporting much-needed foreign direct investment in Romania’s Dolj County. The project will stimulate the local economy, create jobs, and facilitate the transfer of technology and skills that can be replicated elsewhere. We hope that the investment will also encourage other investors to follow ETİ Gıda’s example.”
Firuzhan Kanatlı, chairman of the board of ETİ European Food Industries S.A., the Romanian subsidiary of ETİ Gıda, added: “Our new production facility in Craiova is set to become one of the most technologically advanced plants in south-eastern Europe. Here we aim to produce high-quality confections for the local and international markets to further boost our exports to the EU and the rest of the world.”
The construction will start by the end of 2014 and, when operational in 2015, the plant will employ about 300 local people. The factory will use grain and flour sourced directly from local farmers, providing them with access to a formal market.
Driving foreign investment is one of the priorities for the EBRD in Romania, the country’s leading institutional investor. To date, the Bank has invested nearly €7 billion across 366 projects in the country. It has also mobilised over €14 billion for these ventures from other sources of financing.